Time Warner faces suit over modem rental fee

Two class-action lawsuits were filed Tuesday on behalf of Time Warner Cable customers in an effort to stop the company from charging a $3.95 fee for modem rental.

The lawsuits, filed on behalf of residents in Manhattan and Fort Lee, N.J., allege the modem fee breaches TWC’s customer contracts and violates consumer fraud laws in New York and New Jersey.

“It’s a massive high-tech consumer fraud accomplished by low-tech methods,” said attorney Steven L. Wittels in a statement released Tuesday. Joli Plucknette-Farmen, TWC communications manager for Western New York, declined to comment.

The dual suits also allege the modem lease fee was a rate hike in disguise, one that will cost TWC cable customers across the country $40 million each month.

The new fees, industry commentators have suggested, could boost company revenues from $19.7 billion last year to a projected $20 billion.

“Frankly, the whole modem lease scheme feels very wrong,” said co-counsel Richard Roth in the statement.

The suits were brought on behalf of Manhattan resident Kathleen McNally and Fort Lee resident Natalie Lenett as well as all customers in the 29 states where TWC operates.

TWC has repeatedly said the lease fee was to be used for modem maintenance, to service or replace damaged Internet modems and to better enhance Internet services. TWC subscribers in Pennsylvania, Maine, and North and South Carolina were also hit with the $3.95 fee effective Nov. 1. New York City customers started paying Oct. 15.

TWC has about 15 million customers in the United States, said Plucknette-Farmen. About 10 million subscribe to the Internet service, according to the lawsuit.

The company is in the process of instituting modem rental fees nationwide.